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On Our Radar

Bond Prices Fall As Ukraine Crisis Calms

U.S. Treasury debt prices fell on Thursday as fears over a war in Ukraine abated, helping drive benchmark yields to their highest levels in a week, and as traders prepared for Friday's key non-farm payrolls report.

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Markets await the results from a referendum vote due in 10 days that will decide whether Crimea will become a part of Russia.

"The big story today was a continuation of the easing tensions between the Ukraine and Russia, a reasonable bid in the equities market and somewhat unfriendly data for bonds," said Ian Lyngen, a senior government bond strategist at CRT Capital in Stamford, Connecticut.

The number of Americans filing new claims for unemployment benefits hit a three-month low last week, a sign of strength in a labor market that has been hobbled by severe weather. That sent yields to a session high of 2.7410 percent.

Bonds traded in a sideways range as investors awaited the non-farm payroll report for February. Wednesday's weak private employment data and a severe winter have clouded predictions for the report, said Steve Van Order, a fixed income strategist with Calvert Investments in Bethesda, Maryland.

"You could have almost anything come out tomorrow," said Van Order

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Losses were capped by the European Central Bank's decision to leave interest rates unchanged, holding its nerve in the face of uncomfortably low inflation.

Ten-year notes were last down 12/32 in price, pulling yields up to 2.739 percent after Wednesday's close of 2.696 percent. Thirty-year bonds fell 24/32, sending yields to 3.685 percent from Wednesday's close of 3.644 percent.

Traders see 10-year note yields finding support at 2.75 percent, the 100-day moving average and resistance at the 2.60 percent.

The Federal Reserve bought $1.23 billion in debt due from 2039 to 2043.

The Treasury will sell $64 billion in three-year, 10-year and 30-year government debt next week.